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Senate panel OKs Medicaid bill, 2 alternatives

LANSING — A Michigan legislative committee on Wednesday voted to make at least 320,000 low-income adults eligible for Medicaid health insurance in 2014 and beyond, setting the stage for a crucial vote in the Republican-dominated Senate in late August.

In a twist, the GOP-led Government Operations Committee also approved two alternative plans backed by conservative senators who oppose expanding the Medicaid program under the federal health care law. The rival bills, though, lack bipartisan support while the revised Medicaid legislation has backing from Democrats along with some Senate Republicans, Gov. Rick Snyder, business groups, insurers and advocates for the poor.

The moves came six weeks after the Senate adjourned without voting on a House-passed Medicaid expansion plan to the dismay Snyder. The Senate version of Medicaid expansion includes changes but largely keeps intact the guts of a proposal strongly backed by the Republican governor. The full Senate could vote on the measure by late August.

The 4-0 vote on Medicaid expansion came after two days of testimony, with two Republicans and two Democrats in support and one Republican who abstained. The other two plans were approved 3-2 along party lines.

Senate Majority Leader Randy Richardville, R-Monroe, said while he is a strong supporter of the main Medicaid expansion legislation, proponents behind two other plans deserve a chance to keep working on them.

Another committee member, Senate Minority Leader Gretchen Whitmer, criticized the move to bring three plans to the Senate floor, saying it "sends a convoluted message."

Medicaid covers roughly one in five Michigan residents, mainly low-income children, pregnant women and disabled people but also some poorer working adults. The legislation, if the federal government signs off on it, would provide Medicaid to nearly a half-million more adults by 2022, cutting the state's uninsured nearly in half.

The federal health care overhaul lets states expand Medicaid to adults making up to 133 percent of the poverty level, or about $15,500 for an individual and about $26,500 for a family of three. The U.S. government is offering to cover the entire cost initially and 90 percent later.

The bill includes requirements that new able-bodied enrollees making between 100 and 133 percent of the poverty line pay up to 5 percent of their income on medical expenses. They would have to contribute up to 7 percent after getting Medicaid for four years or shop for insurance from a new marketplace where they could qualify for federal tax credits to help pay for it.

Medicaid recipients could lower their premiums and co-pays if they meet healthy behaviors like not smoking and completing an annual health risk assessment.

The Medicaid expansion would end once cumulative state costs exceed savings that result from shifting state mental health and other to the federal government. The nonpartisan Senate Fiscal Agency estimates the expansion would stop in 2027.

One of the alternative plans passed would direct the state to create private health insurance exchanges and move Medicaid recipients to individual health savings accounts with which they could buy coverage.

The other plan would have people making between 100 percent and 133 percent of the poverty level buy insurance on the federally created health exchange coming to Michigan. Those earning under that amount would be covered by the state, and critics said it would cost the state hundreds of millions of dollars a year while Medicaid expansion would save the state initially.

Snyder, who has clashed with the Senate over Medicaid expansion, commended the committee for voting.

"This is an opportunity that we can't pass up. Too many Michigan lives depend on it," he said in a statement.